[Ip-health] Stat+: World Health Assembly adopts resolution over transparent drug pricing to mixed reviews

Thiru Balasubramaniam thiru at keionline.org
Tue May 28 11:08:56 PDT 2019



World Health Assembly adopts resolution over transparent drug pricing to
mixed reviews
By ED SILVERMAN @Pharmalot
MAY 28, 2019

After a week of intense haggling, the World Health Assembly has adopted a
controversial resolution designed to improve access to medicines. Yet the
effort received decidedly mixed reviews over language that bolstered
transparency into drug pricing, but maintained a curtain around key R&D

The resolution, which was introduced last February by Italy and
co-sponsored by 20 other countries, is seen as a vehicle by cash-strapped
governments to control their drug spending, an issue that has reverberated
around the world and, increasingly, engulfed wealthy nations, as well.

The outcome, though, has disappointed patient advocacy groups, which
offered lukewarm praise for the agreement over concerns that it will remain
difficult for countries to obtain enough needed information for negotiating
affordable prices for medicines.

“This is a welcome first step to correct the power imbalance that exists
today during negotiations between the buyers and sellers of medicines,”
said Gaelle Krikorian, who heads policy at the Doctors Without Borders
access campaign, in a statement. But “the resolution passed today lacks
strong norms.”

During the runup to the WHA meeting, several countries in which the
pharmaceutical industry has a large presence — among them, the U.S., the
U.K., and Germany — began pushing back and sought to water down or simply
remove key passages.

In particular, the wording surrounding certain R&D costs — especially those
involving clinical trials — was altered. A May 20 draft urged countries to
require drug makers to disseminate results and costs regardless of
outcomes, while the adopted version merely wants countries to support

The issue matters because the role that R&D costs play in the larger
discussion about drug pricing is a constant source of controversy.

The pharmaceutical industry regularly argues that many medicines,
especially those that are used to treat cancers and rare diseases, require
substantial outlays that must be recovered to not only cover costs, but
provide incentives to conduct further research.

In response, patient advocacy groups and a growing number of lawmakers have
been asking the industry to open its books in order to better understand
the relationship between costs and pricing. Drug makers, however, have been
consistently unwilling to do so, arguing that it is extremely difficult to
assign costs to a specific product.

The resolution, however, was crafted to address this issue, at least in
part, by gathering clinical trial costs that would provide a map for the
different testing phases for medicines, which would also separate such
expenses from related costs, such as registering products with government
regulators. In doing so, it might also provide a window into spending for
different kinds of diseases.

“There are meaningful provisions (in the resolution) that, if implemented
consistently and completely by governments, will increase transparency
about product prices,” Asia Russell, the executive Director, Health GAP, or
Global Access Project, wrote us.

“That’s important. But it’s far from sufficient. Keeping governments and
patients in the dark about R&D costs is pushing systems to the brink and
literally costing people their lives and livelihoods. … Pharma knows as
soon as the veil is lifted on R&D costs, the deception they use to charge
astronomical and deadly prices fall apart.”

In the end, the U.K., Germany, and Hungary disassociated themselves
entirely from the resolution, while the U.S. had sought to eliminate the
requirement for R&D disclosures. Last week, U.S. Health & Human Services
Secretary Alex Azar questioned whether disclosing R&D costs amounts to
“meaningful transparency.”

This position infuriated advocacy groups, which noted President Trump has
accused drug makers of “getting away with murder” and that his
administration has taken steps to address the cost of medicines. “Nobody
should believe Mr. Trump when he talks about taking on Big Pharma,” Sen.
Bernie Sanders (I-Vt.), an industry critics, tweeted late last week.

As for the U.K., the government may be locked in a high-stakes battle with
one drug maker, Vertex Pharmaceuticals (VRTX), over the cost of cystic
fibrosis medicines, but is concerned about the willingness of companies to
maintain investment in the country in the wake of the Brexit vote.

For its part, the International Federation of Pharmaceutical Manufacturers
and Associations, an industry trade group, released a statement expressing
caution about the resolution. “The single focus on price falls far short of
the complexity of access issues at large. … How transparency on net prices
across very different markets will impact patient access to medicines,
remains to be seen.”

Despite various reservations, one advocate noted the resolution did contain
important bright spots.

“The R&D language is horrible, just terribly disappointed,” said Jamie Love
of Knowledge Ecology International, who was in Geneva to monitor the WHA

“But there is now a resolution calling on countries not to use
non-disclosure agreements (with drug makers), in order to make prices
transparent and not just to each other, but also to the public. This is the
first time we’ve seen this. It’s a big deal and went to right of the heart
of the problem,” he told us.

He pointed to a provision requiring countries to improve reporting from
drug makers on their revenue, prices, units sold, marketing costs, and
subsidies and incentives. Love also noted that pricing language was, in
some respects, supported by the Trump administration, which has proposed
crafting an index that would track what other countries pay for medicines
and be used to negotiate prices for some drugs.

“I think we’ve moved the ball forward,” he said.

Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International
41 22 791 6727
thiru at keionline.org

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